Most Important E-Commerce Fraud Trends [2026]

E-commerce fraud trends in 2026 have shifted from technical hacks to AI-driven manipulation and exploitation of real-time payments. To stay ahead of fraud attempts, e-commerce merchants need to be aware of the most common fraud schemes that are being used to target e-commerce stores today. These include:

• Omnichannel fraud – BOPIS and “click and collect” risks
• Returns and policy abuse fraud – Wardrobing fraud, chargeback/friendly fraud, and return as a service (RaaS) fraud
• Identity and account theft – Account takeovers (ATO), synthetic identities, and new account fraud
• Automated and technical attacks – Bot impostors, SQL injection, or cross-site scripting, and backdoor file fraud
• Infrastructure and data risks – data breaches

With newer ecommerce fraud trends appearing on the scene:

• AI-driven fraud
• BNPL and credit layer fraud
• Social commerce scams
• Digital wallet fraud
• Human or AI-powered manipulation

When you know how to protect your business, it’s possible to avoid all of these types of fraud.

Buy Online Pick up In-Store (BOPIS)

“Click and collect” became a popular biosecurity strategy during COVID-19 as customers tried to avoid handling cash, and has since become entrenched in society. However, the system of handing over goods on the same day after online payments had already been made opened the door for opportunistic fraudsters to collect other customers’ goods (for free).

How to Prevent BOPIS Fraud

The solution to BOPIS fraud is to require account registration for online payments and ask for the customer’s ID when they come to collect their purchase. Running AVS (address verification service) and CVS (card verification) checks at the checkout provides an additional layer of security.

Returns Fraud and Policy Abuse

Fraudulent returns accounted for about 15% of the projected $685 billion in returns in 2024. While a straightforward returns policy is essential for keeping good customers coming back, it’s important to know how returns fraud works and how to stop these fraud attempts in their tracks.

Wardrobing Fraud

Wardrobing fraud is so common that perpetrators might not even consider themselves to be fraudsters. In this kind of fraud, customers purchase high-end luxury goods online, use them once, and return them with the tags still intact before the returns period has passed.

Wardrobing Fraud Prevention Tips:

• Use 360-degree security tags placed in areas that are hard to conceal.
• Design tags that are not easily removed and replaced.
• Make your returns policy extremely strict as far as not accepting dirt, perfume, and other markers of wear on returned items.

Friendly Fraud / Chargeback Fraud

Friendly fraud, also known as chargeback fraud, occurs when online shoppers claim not to have received the goods (often weeks or months later) and force chargebacks through their card-issuing bank. Ultimately, it’s e-commerce retailers who bear the financial loss.

Friendly Fraud Prevention Tips:

• Track shipments and require a signature upon delivery.
• Follow up about the arrival of purchases around a week after purchase.
• Make your returns policy easy to access.
• Issue refunds promptly and cheerfully.
• Choose a merchant service provider with chargeback protection.

Return as a Service (RaaS)

Return as a service is a more sophisticated kind of fraud that involves professionals and amateurs working together to target e-commerce merchants and make money off fraudulent transactions involving returns.

RaaS Prevention Tips:

To prevent RaaS, put strict time limits on returns, always require the receipt, check it in your system, and offer store credit rather than cash refunds. Make it clear to employees that colluding in any kind of fraud will result in immediate termination and criminal proceedings.

Account Fraud and Identity Fraud

Account fraud, or payment fraud, has become increasingly automated and covers three more e-commerce fraud trends that you’re likely to see. Scammers make use of platforms to coordinate these types of fraud, called Fraud-as-a-Service (FaaS) platforms.

• Account Takeovers (ATO): Fraudsters use stolen credentials and stolen credit card details to log in to customers’ accounts, make purchases, and intercept the purchases before they are received. Account takeover is often part of identity theft.
• New Account Fraud: This is one of the e-commerce fraud trends that has risen significantly in recent years; 8.3 % of all digital account creation attempts in 2025 were suspected of fraud. Fraudsters create a new account using a stolen credit card and usually make purchases within 24 hours of creating the account.
• Synthetic Fraud: Synthetic fraud occurs when fraudsters create a synthetic identity using the details of several real people, stolen from the deep web. This synthetic identity is then typically used to secure credit. Synthetic identity fraud attacks are mostly an issue for online retailers who offer BNPL or payments in instalments.

Account Fraud Prevention Tips

The best way to reduce all types of payment fraud is to conduct background checks on new customers and verify the information provided. Merchants should use automated verification tools to catch fraud early on. Some of the most-used fraud detection tools include:

• Card and Address Match: Use of card verification number (CVN) and address verification service (AVS)
• Identity Verification: E-mail and phone verification using tools that verify longevity
• Geolocation: Check geographic maps and indicators, IP, and Proxy-Piercing

AI and Behavioural Tools

• Behavioural Biometrics: Using AI tools to monitor non-human behaviours indicating the presence of bots
• Multi-Factor Authentication: Setting up authentication when high-risk is detected
• Device Fingerprinting: Identifying hardware “fingerprint” or “signature” to follow suspicious transactions

Digital Fraud and Data Breaches

Several types of digital fraud have come to the fore in recent years and are likely to continue in 2026. The most common kinds of digital fraud, according to the European Banking Authority report on fraud, have shifted from technical breaches to human manipulation and real-time payment systems exploitation.

Traditional and Persistent Technical Threats

• Bot impostors: Malicious bots impersonate Google bots and look for holes in websites’ software.
• SQL injection: Hackers enter code into an input field box (like a username or password field) to return all of the usernames and passwords in your database.
• Cross-site scripting (XSS): Hackers create redirect links that either take good customers to phishing websites or take customers through an affiliate link to earn affiliate commissions unethically.
• Backdoor files: Hackers enter the backdoor of your website to gain remote access to data files and make remote changes to your website.

Modern Fraud Techniques

• Business E-mail Compromise (BEC): Leading cause of transfer losses in Europe, hackers use AI-deepfakes and social engineering to trick customers into authorising payments into fraudulent accounts.
• Data breaches: Customer and corporate data are stolen, and accounts are taken over due to security lapses.
• Authorised Push Payment (APP) scams: Hackers and fraudsters manipulate customers into sending real-time transfers (through SEPA Instant, for example), making funds unrecoverable by the time fraud is detected.

How to Prevent Digital Fraud

Preventing these kinds of fraud attacks is a little trickier than preventing payment fraud, but it’s not impossible. To slow online fraudsters down, merchants can:

• Benchmark legitimate Google bots
• Know their affiliates and review affiliate commission statements regularly
• Add banners to educate their customers about how to recognise their official website (HTTPS address, trust markers, logo, or image in search results)
• Add SQL parameters to the user account fields to prevent SQL injection
• Layer defences and have an up-to-date firewall and antivirus, and refrain from downloading suspicious files
• Leverage AI-powered tools to analyse suspicious behaviour that common firewalls might not detect

While the e-commerce fraud rate in Europe is lower than the global average, implementing fraud protection tips and having a solid fraud prevention program will help you eliminate (or at least reduce) financial losses from online fraud.

The Human Factor: Internal Risks and Collusion

In many cases, fraudulent transactions are perpetrated by bad actors inside the company or people from inside and outside of the company colluding. Internal collusion and “Hybrid Fraud,” where external fraudsters pressure or trick employees into aiding with fraud, are a significant threat to modern businesses.

This is a problem not only because of the economic costs of card-not-present fraud but also because of the effects on customer trust and the reputation of the company in general when the fraud is discovered.

Prevention Tips for Internal Security

To prevent internal data breaches, internal identity theft, and fraud, it’s essential to use a PCI-compliant global payment gateway that uses secure encryption for all transactions. In addition, merchants need to train their staff in payment security, restrict access to credit card details, and warn their staff that there will be criminal proceedings for any case of fraud.

Emerging Fraud Trends in 2026

E-commerce fraud is also integrating and moving towards the following trends:

• Buy Now, Pay Later Fraud: Often on high-value B2B purchases, the fraudster exploits the interest-free period and disappears before the first instalment is due.
• Digital Wallet Fraud: Scammers target clients during the enrollment to a digital wallet, stealing card information and adding it to their own devices.
• Social Media Fraud and “Quishing”: Fraudulent QR codes on social media platforms lead customers to make payments and provide credentials on fake pages.

Regulations, Compliance, and the Impact of Fraud

Fraud brings about lasting economic and reputational impact, loss of inventory, and may bring about fines if mandatory regulations are not respected. Compliance no longer involves only protecting data, but protecting the entire payment chain.

• PSD3 and PSR: European payment regulations make rules stricter to catch “spoofing” and make merchants more liable for information breaches.
• Strong Customer Authentication (SCA) 2.0: The standard and mandatory for almost all digital transactions, failure to apply this two-factor verification results in the merchant or provider being 100 per cent responsible for fraud costs.
• Verification of Payee (VoP): A legal requirement for all SEPA transfers. Recipient name and IBAN information have to match before the transfer is accepted.
• GDPR: Merchants can be fined up to 4 per cent of their global turnover in the case of breaches involving customer “personal information.”

Economic losses are also felt through “false declines,” where legitimate customers are blocked due to high fraud rates.

E-commerce Fraud FAQ

1. How can I avoid fraud as a small merchant?Layering security and using an end-to-end payment processor that leverages automatic tools such as AI-monitoring and 3D Secure 2.0.
2. What is the Verification of Payee (VoP)?This is a new European requirement used to prevent invoice fraud. Before transfers are completed, banks cross check account name and IBAN to make sure they match.
3. Is BNPL riskier than a credit card?It can be, as the chargeback frameworks are less established than those of a credit card. It is important to use providers that assume 100 percent of the credit risk.

Choose Customisable Fraud Protection That Works for You 24/7

Online payment fraud continues to rise: in 2024, the total value of payment fraud in the European Economic Area reached approximately €4.2 billion. This is up significantly from €3.5 billion in 2023. The risk of experiencing online fraud is high.

European merchants are now facing fraud threats that are automated, instant, and include personal manipulation. Now that you know about the top e-commerce fraud trends for 2026, it’s time to take action with fraud protection software that keeps you in control.

The best fraud prevention strategy not only uses traditional technical firewalls but also leverages AI-monitoring, is SCA-compliant, and will work for you around the clock, allowing you to make informed choices, ensuring your business is as protected as possible.

While fraudulent transactions will never be eliminated completely, staying abreast of the trends and using a fraud prevention service that’s updated to secure the latest threats will help to keep any losses to a minimum.

Published: August 11, 2022
Last updated: February 2, 2026